ADDENDUM NUMBER 3

DATED

March 19, 2018

TO

SPECIFICATIONS

FOR

REQUEST FOR PROPOSAL #: 18-9009-DH-U

FEBRUARY 28, 2018

THE SPECIFICATIONS NOTED BELOW ARE MODIFIED AS FOLLOW AND EXCEPT AS SET FORTH HEREIN OTHERWISE REMAIN UNCHANGED AND IN FULL FORCE AND EFFECT:

THE SPECIFICATIONS NOTED BELOW ARE MODIFIED AS FOLLOW AND EXCEPT AS SET FORTH HEREIN OTHERWISE REMAIN UNCHANGED AND IN FULL FORCE AND EFFECT:

Notification:

The University of Missouri hereby, extends the RFP Opening Date to, March 29, 2018, at 2:00 p.m. C.T.

Clarification:

Q1. Does the required licensed attorney have to be on staff or can the attorney be a part of our nationwide network of attorneys? A2. NO

Q2. What is the preferred method of account assignment?A2. Sending list by email; Loans will assign via ECSI

Q3. Is it the expectation that standards are graduated by dollar thresholds? A3. (Not sure); loans expects all accounts to have contact attempts in

writing and by phone at least once each month for all dollar amounts placed. Agencies may make any additional attempts to help increase their collection.

Q4. Is providing the banking contact information sufficient for the reference portion of this section? A4. Yes, upon review the University Reserves the right to request additional information.

Q5. Is a representative sample of clients satisfactory or is the entire list required?

A5. Yes

Q6. What are current collection rates? A6. Varies by agencies; loans varies by agencies, subject to caps by Dept.

of Education and/or Dept. of Health

Q7. Section A (7), paragraph 3 (page 4) indicates, “Diverse suppliers can also be used as subcontractors by a majority-owned supplier to fulfill its contract with the University.” Please clarify the University’s definition of subcontractor. For example, does the University consider third-party vendors that provide letter services or batch skip tracing services to be subcontractors?

A7. Yes

Q8. Section A (7), paragraph 1 (page 5) indicates, “Proposals that do not meet the participation requirements for Supplier Diversity will not receive any of the points during proposal review.” Please provide the following clarifications:

What percentage of evaluation points are allotted to supplier diversity?

A8.a N/A

What is the University’s supplier diversity participation requirement for this? RFP?

A.8b 10 % is the goal of the University.

Q9. (Section A(12) Insurance (page 7) indicates, “The Contractor shall purchase and maintain such insurance as will protect the Contractor and the University against any and all claims and demands arising from the execution of the contract.” What are the specific types and limits of insurance required by the University for this Contract?

A9. Professional Liability See the University of Missouri Risk and Insurance

Q10. Section B (2) Preparation of Proposals (page 8) indicates “proposals must be enclosed in a sealed envelope plainly marked: ‘Proposal RFP# 18-9009-DH-U’”. Please confirm the correct reference number for this RFP. 18-9009-DH-U

A10. The RFP reference number; 18-9009-DH-U Collection Agency Services

Q11. Detailed Specifications and Special Conditions, Section 1, paragraph 1 (page 13) indicates, “The Curator of the University of Missouri…propose to contract on behalf of the University of Missouri System…with multiple organizations to provide COLLECTION SERVICES…” Please provide the following clarifications:

How many agencies does the University anticipate selecting for contract award? This number cannot be determined at this time.

A11.a This number cannot be determined at this time.

With which agencies is the University currently under contract (i.e., incumbent agencies) for the services described in the RFP?

A11.b Varies by campus

Q12. Detailed Specifications and Special Conditions, Section 1, paragraph 4 (page 13) indicates, “Attached hereto is a Form of Proposal to be used for the submission of information requested herein.” Please confirm this paragraph refers to the Proposal Form provided on page 31 of the RFP. Are agencies permitted to provide responses to all other sections in the agency’s format citing the University’s language for each section/item?

A12. Yes

Q13. Detailed Specifications and Special Conditions, Section 2, paragraph 2 (page 14) indicates, “The purpose of this RFP is to provide collection services.” Please provide the following clarifications:

Will the University place primary placements (i.e., accounts never placed with a third-party collection agency), secondary placements (i.e., accounts placed with at least one third-party collection agency), or a combination thereof?

A13.a Combination

What account types (e.g., Perkins Loans, Health Professions Student Loans, Nursing Student Loans, institutional loans, tuition, accounts receivable, etc.) will the University place for collection?

A13.b MU Student Account; Perkins, Institutional Loans, Nursing, Nurse Faculty, Health Profession (HPSL, Disadvantaged, Vet Med, Primary Care)

What are the number and total dollar value of any backlog of accounts (i.e., accounts available for placement immediately upon contract award, including those recalled from incumbent agencies), segregated by account type and placement level?

A13.c (Not Sure)

What are the estimated number and total dollar value to be placed annually, segregated by account type and placement level? Varies by Agencies; last year placed 1,122 loans with total $3,561,981 – 499 $1,629,306 1st and 623 $1,932,676 2nd/3rd.

A13.d Currently these are divided between 2 agencies – the best performer gets 60% and the 2nd best 40%. We rotate placements.

What is the average age of accounts at placement, segregated by account type and placement level?

A13.e MU Student Account would be 3 to 4 months; Loans - most 1st placements are 5 months past due; 2nd placements would be around 18 months past due; 3rd placements are at least 30 months past due and often older than that.

What are the incumbent agencies’ current contingency fees?

A13.f Varies by agencies

What are the incumbent agencies’ historical recovery (e.g., liquidation) rates, segregated by account type and placement level?

A13.g (Not sure); Loans – last year’s 1st placements averaged 32% of dollars placed and 2nd placements averaged 11%

What were the average contingency fee paid to each incumbent agency during 2016 and 2017?

A13.h Varies by agencies

Q14. Detailed Specifications and Special Conditions, Section 5, Payment (page 14) indicates, “All proposals to be submitted on the basis of payment by University Check or Credit Card, terms Net 30.” However, Section B(9) on page 12 indicates, “Preferred settlement method is through the use of Electronic Accounts Payable solutions. Payment terms

associated with these forms of payment will be issued as net 15 after the day of invoice. Payment terms associated with settlement by check will be…net 30 days.”

Please clarify the University’s payment terms.

A14. Payment to the University net 30 days upon collection/receipt.

Q15. Detailed Specifications and Special Conditions, Section 6, paragraph 4, bullet 1 (page 15) indicates a response to “Information for Respondents and General Conditions” must be provided as part of Volume I. We were unable to locate a section titled “Information for Respondents and General Conditions. Does this refer to Section 9, Limiting Criteria on pages 18 to 27 of the RFP?  

A15. Yes, Respondents are to respond to the entire RFP.

Q16. Detailed Specifications and Special Conditions, Section 6, paragraph 5 (page 15) indicates agencies must provide a “Pricing and Fee Response (Section 12) in Volume II, and Section 6, bullet 1 goes on to indicate Volume II should include the “Proposal Form with responses to Pricing & Fees”. We were unable to locate both Section 12 and the “Pricing & Fees” section on the Proposal Form. Please provide the updated Proposal Form or

indicate the fees requests and where in the proposal such fees should be included.

A16. The information listed in the RFP is correct, Volume II should include the Proposal Form on Page 231, of the RFP, All fee’s respondents must provide the agencies fee’s in Volume II.

Q17. Detailed Specifications and Special Conditions, Section 8(C) (page 17) indicates “Desirable Criteria (Evaluation Questions)” and “Pricing and Fees – Pricing Proposal” as the criteria on which proposals will be evaluated. What are the point values or relative weights assigned to each of these criteria?

A17. N/A

Q18. Detailed Specifications and Special Conditions, Section 9, Limiting Criteria (pages 18-27). Does the University desire detailed responses to each item in Section 9, or are agencies only to provide detailed responses where specifically requested?

A18. Section #9, requires and Yes or No response. The University is seeking compliance from respondents in each of the questions outlined in section 9.

Q19. Detailed Specifications and Special Conditions, Section 9.6 (page 18) indicates, “The Contractor understands that the University and/or contracted loan servicer shall perform appropriate oral or written demands informing the debtor to the consequences of his failure to make payments prior to turning accounts over to Contractor.” What internal attempts to collect an account are made by the University and/or contracted loan

servicer prior to placing the account for collection services?

A19. For MU student account – the student has received multiple emails before the collection process starts. Once in the collection process the student receives two letters and two emails before the account is then sent to collections where they receive a letter and an email stating that they have been sent. For loans, ECSI handles our accounts – all get monthly bills (borrowers get paper bills unless opt into e-bills). Once past due, even the

borrowers opting for e-bills will get at least one past due notice before getting final demand notice. ECSI makes phone call attempts within federal regulations.

Q20. Detailed Specifications and Special Conditions, Section 9.22 (page 22) appears to be incomplete. The final sentence states, “The Contractor shall submit all monies to…” Please provide the remainder of the content for this section.

A20. Omit question

Q21. Detailed Specifications and Special Conditions, Section 10.1(b) (page 27) indicates, “Include a copy of your collection procedures and standards graduated by dollar thresholds. Also include a copy of your current collection policies.” Does the University require copies of policy and procedure documents or a narrative description of the agency’s collection policies and procedures?

A21. Yes

Q22. Detailed Specifications and Special Conditions, Section 10.1(g) (page 28) states, “Provide the number of staff who handles healthcare

collections vs. other lines of business.” Please confirm “healthcare” should be “higher education”.

A22. Disregard the reference to healthcare, the seeking only Higher –Education Collection.

Q23. Detailed Specifications and Special Conditions, Section 10.1(m) (page 28) indicates, “Provide examples for how your commission is calculated.” Please clarify the type of account on which commission is being calculated. Does this question refer only to litigation accounts?

A23. All student accounts sent to your agency. And all types of student loans.

Q24. Detailed Specifications and Special Conditions, Section 10.3(f) (page 29) refers to agency years of involvement in “healthcare collections”. Please confirm “healthcare” should be “higher education”.

A24. Yes it would be higher education

Q25. Detailed Specifications and Special Conditions, Section 10.4(a) (page 29) indicates, “List all companies, agencies or institutions you currently collect for, including contact names and telephone numbers for purposes of verification.” We consider our complete client list highly confidential and, as such, prefer not to publish the list externally. Would the University consider accepting a sampling of current collection contracts?

A25. Need to furnish 10 higher education institutions.

Q26. Detailed Specifications and Special Conditions, Section 10.6(g) (page 30) requests information regarding compliance with “501(r)”. IRC Section 501(r) relates directly to healthcare accounts. Was reference to 501(r) inadvertently included in the list, or does the University’s portfolio include patient balances?

A26. Disregard the reference to healthcare, the seeking only Higher –Education Collection.

Q27. Detailed Specifications and Special Conditions, Section 10.7(e) (page 30) inquires “are the recordings available to the healthcare organization upon request”? Please confirm “healthcare organization” should be

“University”. If not, are University of Missouri Health Care accounts included as part of this contract?

A27. Disregard the reference to healthcare, the seeking only Higher –Education Collection.

Q28. Will this project for the University include primary placements, secondary placements or a combination thereof?

A28. Combination

Q29. Please clarify whether resume summaries will be acceptable in lieu of full resumes.

A29. Summaries are fine

Q30. Section 6 – Volume 1 requests “Response to Information for Respondents and General Conditions, Desirable Specifications, and the Mandatory Information Technology Security Requirements Questionnaire.” Is this refereeing to sections 7. IT STANDARDS AND REQUIREMENTS QUESTIONNAIRE (ITSRQ): UMS 2018 Attachment A, 9.Limiting Criteria, and 10. Desirable Questions?

A30. Yes, Attachment A, ITSRQ attached excel document. As listed on the University of Missouri Procurement Website.

Q31. Question 9.12 requests “providing all necessary collection forms, letters, etc.” Will the University accept the most frequently used correspondence sent to borrowers rather than all correspondence? As the entirety of an offeror’s correspondence can exceed 200 pages.

A31. Need frequent, and then 5-10 examples of other correspondence that might be sent

Q32. Question 9.31: “The Contractor shall remove all accounts requested to be closed by the University from the debtor’s credit report. Notification will be mailed by the Contractor to the debtor and a carbon copy to the University, to advise that the debt has been closed and will be removed from the debtor’s credit report within 30 days.”

Will the University provide assurance that it will provide us the appropriate date of delinquency for credit reporting purposes?

A32. Yes

Q33. 6. Questions 10.1(g), 10.3(f) and 10.7(e) refer to “healthcare” collections.

Are respondents required to have healthcare collection experience in addition to experience in recovering education-related receivables?

A33. Please disregard – only for higher education

Q34. Question 10.4 a. requests a “List all companies, agencies or institutions you currently collect for, including contact names and telephone numbers for purposes of verification. The list must include colleges, universities.” How many clients would you like us to provide on this list?

A34. Full list

Q35. What areas, processes and/or results are you looking to improve or enhance under this new contract?

A35. New agencies with which to place both 1st and 2nd accounts

Q36. Why is the contract out to bid at this time? A36. To obtain new agencies with which to place both 1st and 2nd accounts, current agreement(s) expiring.

Q37. Has the current contract gone full term? A37. Yes

Q38. How long have the incumbents been providing the requested services? A38. Varies by agencies

Q39. What are the current recovery rates of the incumbents? A39. Varies by agencies;

Q40. What is the University expecting to improve upon with this RFP and resulting contract?

A40. To obtain new agencies with which to place both 1st and 2nd accounts.

Q41. What collection attempts are performed or will be performed internally prior to placement? A41. For MU student account – the student has received multiple emails before the collection process starts. Once in the collection process the student receives two letters and two emails before the account is then sent to collections where they receive a letter and an email stating that they have been sent. For loans, ECSI handles our accounts –all get monthly bills (borrowers get paper bills unless opt into e-bills). Once past due, even the borrowers opting

for e-bills will get at least one past due notice before getting final demand notice. ECSI makes phone call attempts within federal regulations.

Q42. What is the total historical dollar value of accounts, including any backlog? A42. Varies by agencies;

Q43. What is the total historical number of accounts by category, including any backlog? A43. Varies by agencies;

Q44. What is the total historical average balance of all accounts, by category if relevant or possible? A44. Varies by agencies;

Q45. What are the contracted contingency fees and/or actual dollar amounts of monies paid last year to any incumbent(s), if applicable by category?A45. Varies by agencies

Q46. Does the institution have signed agreements with the borrower to allow for the assessment of collection fees on non-federal debt (institutional loans, accounts receivable, tuition accounts, and other types)? A46. Yes the student signs a Statement of Financial Responsibility; Loans – student e-signs a promissory note.

Q47. Are collection fees added prior to placement? 

A47. Yes,

Q48. How often does the university place accounts? A48. Monthly

Q49. Regarding question 10.5 (a), are the visits going to be unannounced or scheduled? A49. (Not Sure)

Q50. Regarding question 10.6, approximately what percentage of the contract would be healthcare-related debt for 501(r) compliance? Approximately what percentage of the contract would be education-related debt? A50. Please disregard only higher education

Q51. For the purposes of this RFP, would the use of letter vendors or automated databases be defined as subcontractors? A51. University requires additional details

Q52. What is the age of placements?  Will multiple ages be placed with vendors (i.e. primary, secondary, tertiary) A52. Mu Student Account 1st placement is normally 3 to 4 months; MU Loans - most 1st placements are 5 months past due; 2nd placements would be around 18 months past

 Q53. Page 11, Section 5, Contract Award and Assignment mentions the Form of Contract, but that document isn’t included in the RFP. Would it be possible to obtain a copy for our legal team to A54. The University agreement will provided to the awarded contactor(s) at the time of award.

Q55. Page 18, 9.1 Limiting Criteria and Page 27, 10. Desirable Questions: May vendors copy these sections directly into their response to allow for more room to answer the questions asked? If yes, should the Limiting Criteria form be returned along with the response, in addition to the questions copied over from that section of the RFP?

A55. The entire RFP documents must be returned, returning only sections of the RFP will be considered incomplete. Limiting Criteria, are “yes or no” response. Desirable’s questions require direct narrative response. Questions and Answers should remain in the University’s RFP format, clearly stated and easy to read. For example, firms may choose to copy the questions, and word format, by contacting Darla Higgins at, higginsdj@umsystem.edu

Additional white pages advertisements, should not be a part of the respondent’s response. Q56. Page 18, paragraph 9.3 asks vendors to provide a list of states they are not licensed to conduct business. If a vendor is licensed to collect in all states and jurisdictions that require licensure (not all do), should we answer yes or no to this question? A56. List the states in which your firm is not licensed to do business in.

Q57. Page 22, 9.22 Remittance Process: this question appears to be incomplete. The final line reads “ The Contractor shall submit all monies to” but doesn’t indicate to whom the monies should be submitted. Can the University clarify? A57. For UMKC Loans – remittance should go to Heartland ECSI for processing.

Each individual campus (Columbia, St. Louis, Rolla, and Kansas City).For MU Loans, the gross payments go to ECSI.

Q58. Page 23, paragraph 9.23 states, “If payment is received by the University within 10 days of placement, is the result of delayed financial aid

disbursement or tax offset intercept, the Contractor shall charge no fee.” Does this mean that contractors can charge a fee on tax offsets after the 10th day? A58. For UMKC Loans – we would typically assess standard commission as applies to the account, unless otherwise agreed.

UMKC Student Account - No.  No commission will be paid on tax offset payments.  For clarity statement should probably read “If payment is 1) received by the University within 10 days of placement, 2) the result of delayed financial aid disbursement, or 3) is the result of tax offset intercept the contractor shall charge no fee. (MU Agrees)

Q59. Page 25, paragraph 9.30, last bullet point indicates the University wants vendors to report “accounts turned at least 60 days previous to begin reported.” To confirm – is the University asking if vendors credit report after 60 days from

placement. Some states require that accounts be outside of the validation period before an agency notifies consumers of A59. UMKC Student Account - Do not report debts to credit bureaus before 60 days of active assignment, or later as required by law.

For UMKC Loans – all credit bureau reporting of accounts is handled only by Heartland ECSI on our behalf.For MU Loans, ECSI reports our loans to the credit bureau, we do not want the agencies to do so.For MU Student Account – we currently report to the credit bureau 30 days after being placed.

Q60. Page 25, paragraph 9.31 states, “The Contractor shall remove all accounts requested to be closed by the University from the debtor’s credit report. Notification will be mailed by the Contractor to the debtor and a carbon copy to the University, to advise that the debt has been closed and will be removed from the debtor’s credit report within 30 days.”A60.a For UMKC Loans – this does not apply.  See above.

Q60.b. This is only applicable if the campus requests this measure, correct? Q60.c.Agencies do not have any control over the credit bureaus, and so cannot assure remove of information will occur within 30 days. Can the University confirm that an acceptable alternative to the debtor communication described in this paragraph would be to advise the debtor that we have asked the credit bureau(s) to remove the information we reported?Q60.d Is the University referring to all accounts that we close and return or just specific types of accounts that it asks us to close (e.g., accounts placed in error or where it is determined the amount is not owed).  A60.b.c.d

Ultimately the contractor is responsible for any credit bureau reporting updates, corrections, and confirmation of such actions as requested by the University.  Notification that the correction/adjustment has been requested to the credit bureau agency (but not necessarily completed by the credit bureau agency) should be communicated to the debtor within 30 days.  The University is not involve in the credit bureau reporting process.

Q61. Page 28, paragraph g: Given that this RFP is for the recovery of higher education debt, can the University explain its interest in how many healthcare collectors we employ? Similarly, page 29, item f asks about how

long our agency has been involved in healthcare collections. Was this an error, or is our healthcare recovery expertise relevant to this procurement?A61. Disregard the healthcare reference. Q62. Page 29, paragraph 10.4.a requests “list all companies, agencies or institutions you currently collect for.”

a. Our client list is hundreds of entries long, and confidentiality agreements prevent us from disclosing contact information for many of these. Would a representative list suffice?

A61.a.Yesb. Does the University want reference for non-higher-education clients?

Or are college and university references preferred? A61.b.Both

Q62. Will the University supply the original Date of Default/Delinquency at time of placement in order to establish a valid Statute of Limitations date? A62. This is typically apparent by first payment due date not met or time since last payment received when account is assigned. This is a standard part of the collection agency placement file in Pathway now. ECSI reports these dates to the agencies.

 Q63. Can the University provide the monthly placement volume, average balance and average recovery rates by debt type? A63.a For UMKC Loans – this varies across loans types and 1st or later placement.  Perkins loan recovery is generally higher, due to consolidation.

Student receivablesFederal Perkins LoansInstitutional LoansHealth Professions Loans

A 63.b. Varies month-to-month

Q64. Will collection costs be allowed and added to non-Perkins placements to the collection agency? If so, what authority does the university have to allow the collection costs to be added to the amount placed? A.64 For UMKC Loans, yes.  This is included in the promissory notes for the Institutional and Health Professions Loans. For UMKC the collection fee is added (if

applicable) at the time if 1st placement.  The collection fee is assessed to accounts that have either an agreed to Statement of Financial Responsibility or signed Repayment Agreement.  Both documents, along with (MU Agrees)For MU Loans – on Dept. of Health and University Loans, the promissory notes contain

working to allow collection costs/fees.Q65. Can the University provide a copy of its student financial agreement?A65. YESQ66. How many agencies are working the University's portfolio now? A66. 15 plus Q67. What are the agencies' combined annual recoveries on this portfolio for 2015 and 2016? A67. n/aQ68. How will the collection costs to be imposed on an account be communicated by the University to us (e.g. inclusion on placement file)?A68. For UMKC Loans, part of the placement file. For UMKC the collection fee is added (if applicable) at the time of 1st placement and is a separate column on the collection agency file created in via Pathway (Total, Principal, Late fees, Finance Charges, and collection fee).  – This is the same for MU as well.MU Loans – we use the contracted percentage rate, except where Federal Regs trump the rates.Q69. What are the University's requirements regarding account retention? A69. For UMKC Loans, 12 months or active payment agreement. – This is the same for MU Student Account MU Loans leaves accounts at agencies for 12 months, but if the borrower makes payments then the agencies may retain until paid in full

Q70. What is the University’s placement time frame (i.e. weekly, monthly, after a semester)?A70. Monthly

Q71. What is the University’s placement volume, number of accounts & dollar amount expected per placement?A71. UMKC Loans – varies

UMKC Student Accounts – variesMU Student Account – variesMU Loans – last year placed 1,122 loans for $3,561,981

S&T – estimate: 300 accounts; $1.2million

Q71. What is the average age of the debts at the time of placement?A71. UMKC Loans – varies

UMKC Student Accounts – at first placement debt is typically between 5 and 10 months old

S&T – 120-150 days past dueMU Student Account – 1st placements are normally 3 to 4 months old

MU Loans - most 1st placements are 5 months past due; 2nd placements would be around 18 months past due; 3rd placements are at least 30 months past due and often older than that.

Q73. What has been the historic liquidation/recovery rate of the current agencies? A73. UMKC Loans – dependent on age of account at time of placement and type of loan – i.e., federal and eligible for consolidation or institutional

UMKC Student Accounts – varies on placement type 1st, 2nd, 3rd, litigation, HSCP, or institutional loans

S&T – 20%MU Loans (last year) – 1st placements 32%, 2nd placements 10.6%

Q74. Are financials required to be submitted? If so, is the requirement reviewed or audited financials? What percentage of accounts are processed for litigation? A74. UMKC Student Accounts – varies

S&T – does not litigateMU Student Account – does not litigateMU Loans – varies, only will litigate if employment is known/borrower has

means to pay

Q75. Will accounts be closed by current vendors and Seconds placed with newly awarded vendors? A75. UMKC Loans – No

UMKC Student Accounts – No unless the current vendor isn’t approved in the new RFP

S&T does not plan to close accounts with current vendors. We will look at new agencies for possible future placements.

MU Student Account – does not plan to close account with current vendors unless vender isn’t approved

MU Loans – Not unless the current vendors are not approved in the new RFP; may add 1 more agency to see which agencies perform best.Q76. Please clarify the number of copies for each response.A76. RFP Submission one-original, and one electronic copy on a flash drive, thumb drive or jump drive. Electronic files must not contain passwords or encoding.